School Music Superstars on Rental Growth
At The 2020 NAMM Show, Gayle Beacock of Beacock Music hosted a panel of school music retail experts to talk shop about rentals. Beacock asked each to reveal how they achieved rental growth and improved their business year to year. Here are highlights. (Watch the video for their full comments.)
How do you and your team plan for additional growth in the coming year? Mark Goff of Paige’s Music acknowledged that he always wants more growth for his company. Goff shared a speaker’s advice that stuck with him: “Your business does what your business is designed to do.” Although Goff admitted that his business was streamlined to serve the school music market, it wasn’t designed to grow. Going forward, he said that Paige’s Music is aligning its resources and staff with a focus on growth. Goff stated that working harder isn’t necessarily the only key; they also have to send reps out to schools they haven’t called on before. It was a commitment and investment. Goff put an incentive plan in place for the entire company—not just the road reps—to bring in new accounts. Everyone shared in the bonus last year.
What are ways you can grow quickly, if that fits your business goals? Joel Menchey of Menchey Music responded that the school market is a slow-growth industry and relationship-driven. His company’s ed reps spend a long time building school relationships. Menchey conceded that there are ways to fast-track growth if the environment allows it. One way is the affiliate model. Menchey described doing business in both Pennsylvania and Maryland. In Pennsylvania, Menchey Music has a much heavier school service presence. In Maryland, the market is all send-out—schools and teachers send parents and students to the stores to rent instruments. Menchey shared that it’s been easier to go with an affiliate in Maryland to get the business more quickly. Menchey Music consigns its rental products and compensates the affiliate store for its service. It’s a win-win for stores and rental customers, according to Menchey. He cautioned that not all affiliates are created equal, though. Making this a viable business model requires trial and error to find affiliates that share your corporate culture and work well with you.
Another way to grow quickly is to open a store. The downside is the cost and investment, although you have more control over the distribution and culture. Menchey shared that he learned a valuable lesson after opening a store in Colorado, which was far from their home base, with no service component, reps or repair department. Beacock mentioned that if you’re considering purchasing another store, those are all considerations to keep in mind.
How do you leverage your team and leadership to benefit your rental program? Jeff Eckroth of Eckroth Music manages nine stores spread over 1,200 miles and several states. Eckroth advised that as a leader you need to define what your core values and passions are for growing your SBO rental business, and that will flow to your team. If you and your teams have solid, definable, consistent and focused core values, you’ll have a lot of success.
Eckroth suggested asking yourself questions, such as: What value can you bring to the instrumental music education market you want to serve? What’s important to be successful in this mission? How can you profitably align the resources you have toward that endeavor? Can you identify the schools and markets you want to serve, and are those customers’ needs consistent with what you want to deliver as a value-driven company? Eckroth affirmed that when you can pull this all together, it’s where the magic happens. He said his leadership teams think alike and communicate frequently, as if they were in one location.
Eckroth warned that you need to plan for growth, including having the systems, the team, the right people and the ability to stay on top of the financial picture—for instance, paying the vendor for the product up front and letting the customer owe you in installments. The return cycle is long, so you have to have a war chest or you’ll end up growing yourself out of business.
When you’re already successful in school music rentals, what are you going to do in the new year, and how are you going to make your business better? CJ Averwater of Amro Music commented that his company calls on a lot of small, rural farming communities. Amro’s strategy, he added, is to focus on incremental improvements. They look closely at each account and their internal processes, from beginning to end, to gain efficiencies. They try to find ways to grab extra rentals in existing accounts and realize 1–3 percent improvements in everything they do.
What are you doing to have more successful rental nights?
Averwater: We asked our reps to come together at the beginning of the rental season to give their rental presentations. We recorded each one. They all watched and were critiqued. Our operations team gave each rep feedback, so everyone came away with best practices.
Menchey: We finally got away from lugging the horns to parent’s night and take orders instead, so it’s saved on manpower. We also developed PowerPoint presentations for our schools. We can send a consistent message and include music-education advocacy slides, so parents know the importance of having their kids involved in making music.
Goff: If you plan every step from the time the parents arrive, through your presentation and rental agreements, to the time they leave, it makes a huge difference. We understand parents are busy and want to make the process efficient and easy for them. Our presentation is about seven minutes, and parents can review and sign agreements during the presentation and hand them to our team on the way out.
Do you share the number of rentals with your team and does everyone know what you’re striving for next year?
Goff: We share a lot of numbers with our entire team. They always know how we’re doing, and they know the scoreboard. When we’re finished with a parent night, we know how many rentals we have this year versus last year.
Can you talk a little bit about what you’re doing for training and employee engagement?
CJ Averwater: At the end of the day, everybody on the team has to know what we do. We have to make sure everyone’s moving in the same direction, and we have to incentivize them. We put the systems in place to do that. We also put together internal training manuals called Amro University, which requires employees to take tests on different courses based on what they do. We have a bachelor’s, masters and doctorate degree if you pass a certain number of courses.